Every State and Territory Government must follow Victoria’s lead and undertake an immediate review of State business taxes, particularly those on property, Property Council of Australia National President Greg Paramor said today.
The Property Council’s call comes after the State Business Tax review in Victoria today recommended the abolition of business stamp duties, including those on commercial property, and the introduction of a flat land tax rate.
The Review’s major recommendations include:
- The abolition of stamp duty on all business transactions including commercial property conveyances, mortgages, non residential leases, rental agreements and insurance at the earliest opportunity;
- The introduction of a single flat business land tax of 2.89% of unimproved capital value, with no threshold, in the 2001-02 financial year; and,
- Payroll tax reductions.
Mr Paramor said the reforms, if accepted by the State Government, would mark the most significant overhaul of State taxes in Australia for decades and deliver a massive boost to employment and the economy.
“The Bracks Government’s willingness to revamp Victoria’s inefficient tax system is a lesson in proactive leadership for every State in Australia,” Mr Paramor said.
“Every State and Territory in Australia must follow suit, particularly in light of authoritative research showing property imposts are the most harmful taxes on the national economy.”
Mr Paramor said the Victorian business tax review panel had shown that reform of State property taxes encouraged investment, created jobs and boosted retirement savings.
“The review has recognised that property taxes harm the retirement savings of millions of ordinary Australians who invest in commercial property through property trusts and superannuation,” Mr Paramor said.
“More Australians now own a stake in office buildings and shopping centres than residential property and reduced commercial property stamp duties translates into greater collective retirement wealth.
“According to Cityscope, ordinary Australians now own 73% of Melbourne’s CBD. It’s these people who will reap the real benefits from stamp duty abolition in Victoria.”
Mr Paramor said the abolition of stamp duty on commercial property was and will remain the Property Council’s primary national advocacy priority.